Duphar, Solvay May Redo Pact

Duphar-Interfran, the Rs 50-crore pharma major, is weighing options of restructuring relations with its foreign collaborator Solvay-Duphar, which has a 39.8 per cent stake in the company.

Talks between the two partners on possible options include spinning off the pharma division into a separate company with Solvay holding a major stake.

Duphar-Interfran is present in categories like antibiotics, anti-stress therapy, iodine therapy and muscle spasm. Some of its well-known brands include Moxydil, Ginsec and Duodil tablets.

It created ripples three years back when it sold off its famous Crocin brand to SmithKline Beecham Pharmaceuticals.

It followed it up by selling Lacto Calamine to Global Home Products, the 100 per cent subsidiary of Nicholas Piramal Laboratories.

Since then the company's sales have dropped, while profitability has fluctuated. From Rs 69.57 crore in 1995-96, sales dropped to Rs 53.98 crore in 1997-98. Net profit fell to Rs 3.28 crore in 1997-98 from Rs 3.90 crore in 1996-97.

However, the export turnover has almost halved to Rs 2.88 crore from Rs 5.20 crore the previous year, which it has attributed to a fall in demand. D Vasant Kumar, president and managing director, refused to divulge details of the proposed restructuring. "Duphar-Interfran is currently evaluating various options for the future. Meanwhile, we continue to be an Indian company with interests in pharmaceuticals and manufacturing of intermediates," he said.

"Future plans have not been finalised as yet. Whatever we decide will depend on shareholders' approval," he explained.

Solvay-Duphar and Crookes Laboratories hold 39.8 per cent of the company's equity. Solvay is a large player in the animal health business world-wide, but pharma contributes only a small portion of their turnover. In India, the presence of good brands is spurring interest in acquiring more control. Duphar is also planning to launch new formulations in various categories.